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tv   [untitled]    October 18, 2011 11:30am-12:00pm PDT

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phase two. there it two agreements. one with the bridge district of the golden gate bridge district, authorities to receive $80 million as a bridge district's contribution to the project and then a corresponding agreement from the according to the california department transportation that the authority will provide that same $80 million, plus other local funding aggregate and by the authority. the transportation authority -- >> [inaudible] >> it is nominally a $80 million. the transportation authority it and sonoma county authority are collectively committed to provide $5 million. the agreement, and the 2008 memorandum of understanding allowing them to elect, in lieu of making contributions directly to the authority, to make those
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contributions instead to other bridge district projects. in which case, the bridge district would increase their contribution from $70 million to $80 million. both agencies have made an election. commissioner farrell: just for everyone's edification, could you describe the times that the golden gate board put on that? >> i will try to give you the short version. the major times, as commissioner elsbernd mentioned, is a condition that we not impose tolls n doyle drive. this was a major issue in 2008, and weaver struggling to finance the project, in fact, the urban planning grants that the
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transportation authority obtained was to look at congestion pricing that could be imposed on doyle drive. the bridge district felt it could provide competition for artists to a set of corporate toll. there is one that if, in the future, the city of sanfrancisco imposes a pricing regime that would price of the entrances into the presidio, --i mean, into san francisco, then that would be allowed. there would also be something of a poison-pill provision. should that happen, we would be required to repay the $80 million. that would increase the cost,
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puttinga toll on doyle drive. funding for face to -- phase 2 will determine the amounts contributed by the state, the amount contributed by the authority. this is the amount contributed by the state. this is not a year earlier expenditure dollars to cover the entire 30-year operating concession of the ypp. this pays for the entire operation, maintenance of the entire 30-year concession period, and is a young nominal -- is a nominal concession until the year 2025. also includes a renewal effort that is required. at the end of the 30-year concession period, you are
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required to restore the facility with new life and then turned back over to the state. we're getting almost a brand new facility at the end of the concession. the amount being contributed by the authority, you see the $75 million face amount from the golden gate bridge and then the two amounts from marin county and sonoma county, totaling an additional $5 million. in addition, two program amounts. $54 million has already been programmed. just under $45 million in future funds identified. also, more than $23 million in prop k. then the bottom line item, $26
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million, represents what had originally been a federal earmark that were assigned to other projects. transportation commission believed that that money could be redirected to doyle drive. that is unresolved at the moment. as part of the condition, part of that $26 million, having it available. we're only conditionally committing it to the point that either mtc or another group can use those funds. the request is to authorize the executive director to enter into a funding agreement for the presidio parkway project with caltrans and the golden gate bridge district, and to negotiate terms and conditions. happy to answer any questions. commissioner mar: seeing none, public comment is closed. -- is there anyone from the public that would like to comment on this item?
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>> you know, i worked at the presidio. one of the things that we have to note about this project is the leadership, not just a representation, but the leadership that he provided. he, too, worked at the presidio. one of the things that is linked to this in a direct way is how improvements are done to fulfill certain projects that have been in the making for years, repairing projects at the presidio. i was there a couple of weeks ago, and there is one project that is named after a dragonfly. those are the types of things
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the we have gone to the produce it -- to the presidio on for mitigation. another thing that will help us on this project, a lot of the traffic that was going above the ground will be going underground. i do not know when they will really have an opportunity to see and gather empirical data about the pollution. millions and miracles -- millions and millions of vehicles are on doyle drive. many, many agencies participated in the funding, but many agencies also participated in the environmental impact report. early on, i commended those in charge -- there were certain
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sites that were part ecologically sensitive, and they were addressed in a very forthcoming matter. i am looking forward to doyle drive being completed hopefully in the next two, three years, without any problems. we are lucky that we have the funding in place. so we just need to put our best foot forward and complete it. doyle drive will be spectacular once it is completed, and then when spigot in the bay bridge, connected, i hope we can create a mechanism for better traffic, which will help us on 19th avenue, too. thank you. commissioner mar: is there
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anyone from the public that would like to comment on this item? seeing none, public comment is closed. moved without objection. colleagues, thank you. please call the next item. >> item 6. recommend accepting $750,000 from the civic center commons associate llc to waive the lease extension option and to terminate the workspace lease at 100 van ness avenue; executing a 13-year workspace lease with hudson 1455 market, llc for offices located at 1455 market street, with one five- year extension option, in an annual amount not to exceed $685,272, plus operating expenses and annual rent increases; and authorizing the executive director to negotiate the terms and conditions. this is an action item. >> commissioners, jose moscovich. this item begins on page 61. as you know, anticipate, cynthia fong, a deputy of finance can run circles around
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me in terms of the detail on this, but this is a significant enough autumn but i thought i should present it to you. she can provide any additional detail that you will need. we have been at the 100 van ness location for the past 18 years. we brought to you late last year action to authorize me to renew the lease on that location because we had a five- year option that we have to exercise, and that require that we provide notice of that early enough. we did that. what happened since then, the building changed hands. aaa used to own the building. the move out of town, sold the
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building to patson. they held the building some time from 2009. in march 2011 this year they defaulted on their loan on the building. it was essentially taken over by the lenders, the national electrical benefit funds. the lenders have different plans for the building. i understand there want to redevelop the building as a residential building, which frankly, as a planner, living at the future of van ness, brt, is a great idea, unfortunately, it has a great affect on us. they have come back to us and said that we would like you out of the building, frankly, and we would like not to exercise its option on the lease.
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we have had some back and forth about that. the way that the race is 11 -- the lease is britain is in the old way, puts us at a disadvantage in that the landlord has the power to relocate us two different floors to give us with the lease cost comparable space. we have done the legal research on that. in order to have a functional floor, we even need to spend upwards of $800,000 fixing the floor so that we can get our staff and equipment. then we would have that expense amortized over five years. had been made clear to us that at the five-year point, we would have to be out of the building. the building will be undergoing a conversion. even if we chose to stay there, we would have five years of construction impact, safety issues and so on. it has not been great sense aaa
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left. we are now the only tenants in a 28-floor building. that is generating some challenges, as you can imagine. i asked staff to start looking around to see what options we had, so i could present to you in our present -- complete picture of what we could do. the default is to stay there for the next five years and then move at the time. some interesting things happening in the remaining few months since we started looking. we looked at six different properties. most of them are no longer available because of the interest in the civic center. all of a sudden, that area has become a hot market, which is fabulous for civic center, but
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not great for us. we did identify a couple of buildings. one in particular, 1455 market, came up with an offer, property on the 22nd floor. long-term lease. they were very motivated at the time that we started looking, which was great. we secured terms that would allow us to move into the building with a $1.7 million budget to do tenant improvements. so we would not have to pay to relocate into the building, as far as tenant improvements are concerned. then we approached our current landlord to look and when they could do to us to incentivize a move. they made an offer of $750,000, which means between the offer of the potential future landlord and intend for us to move from the current landlord, we would have a 0 expense move.
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the move would be free and tenant improvements would be free. in addition to that, in order to incentivize this, currently at 13 years with a five-year option, which covers most of the life of prop k, the new landlord is also willing to give us nine free months of rent. that would give us the opportunity to move, and it would give us the opportunity to have some more space. to complete this at a comparable makrate in a market that is allotted to volatile. we do not know where things will be in five years, especially if the high-tech interest in this area continues. there is more space there.
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because the amount of square footage, the rent would be higher on a yearly basis. we are looking at something like $300,000 extra from what we pay now. however, the net increase would be lower than that because we have phases to help this process. of course, we would have to designate that particular activity. we also have an offset. there was a 30% increase in staff in 2007. we accommodated that in the space that we have now, but in the conference can -- in the process, we lost a couple of rooms. all of that now can now be
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recouped, in addition to providing a 30% margin for growth over the lease. we think it is a reasonable deal. also, because of the structure of the floor, we have the possibility of subletting. if we find out that something works, that we do not grow, we can create a section of office space on the floor that could be rented out. that may result in an offset of the rent. of course, i am mindful of the increase in annual operating expense than the rent would signify. it is not, by any means, a material increase, considering the budget of the authority is in the $180 billion a year range. it is a reasonable price to pay for the security of having a
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long-term lease at a very clear verbal rape, and in a building that is the only one available that needs the four criteria that we are looking for. proximity to city hall, comparable rates, the right amount of space, and building of comparable quality to what we have now. that is the recommendation in the memo. we would like your blessing to move this forward to secure the lease at the new location, 1455 market, and to accept the offer from the current landlord. if that is the pleasure of the board, we can start the process of preparing a new floor for the move.
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i anticipate the move would happen late spring of next year, early summer. that concludes my report. one more thing. the cac had a lengthy review of this item at their last meeting and supported unanimously. happy to answer any questions or have some the answer any questions. commissioner elsbernd: did you do any coordination with our department in real estate? >> i can let cynthia speak to that. i know we tried to avail ourselves of every source of information we had. >> good morning, commissioners. cynthia fong. at the time that we were looking at the least, we are also looking at the agreement that the realistic decision put together for mta to make sure we
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captured all the deals and provision that they negotiated into. commissioner elsbernd: the puc is abandoning a lot of office space over the next 12 months to move into their new building. did you look to see if there was space available that could have been done at a cheaper rate by moving into their existing facilities? >> the broker mention that the building was not available in the time that we were looking to move. commissioner elsbernd: did you look at the former department of marketing resources building? >> it did not fit our requirements. commissioner mar: any other questions? commissioner kim: page 66, i wanted to make a clarification.
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it is actually an increase in annual rent and operating expenses over five years. an increase of $202,000, and an increase of $190,000. >> yes, compared five years at our current location to the potential new location, we would have a difference of about $200,000. commissioner kim: i know it is a small increase. is that due to the annual rate increase? >> that contributes to part of it but there is also the offset from the rent incentives. commissioner kim: i understand it in the first two years you will have a savings, but over five years we will have a slight loss? >> yes. commissioner kim: just wanted to clarify that. commissioner mar: is there anyone from the public that
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would like to comment on this item? mr. decosta. >> i think it is time that san francisco transportation authority get a building of their own. they have ample space to do the right thing. you know you are on the bay area air quality management district. they are also moving to a huge building. they, too, will be working with other agencies, so we are going to see some changes. i do not know if it is a viable elements, but the flow, anything
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above 20 -- i used to go to the cac meetings a lot, transportation authority meetings a lot. i stopped going. what can i say? we look forward to the agency having a new building a, and also a new vision. a lot of our congestion, requirements and our area -- in our area, if done properly, they will be able to work with other experts in this building to come up with plans that address regional priorities. we have a lot of that in the southeast sector with the
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causeway, the proposed 30,000 units that will be built. a lot of that requires expertise. hopefully, and they will incorporate experts that look into air pollution, the real carbon footprint on a daily basis. there are some engine provided by google and others that give you something in a general way, but since san francisco is very forward-looking, perhaps that can be accommodated if we had more space. thank you. commissioner mar: anyone else from the public rebelled like to speak? seeing none, public comment is closed. mr. de costa also raised the issue of the cac, abag, air
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quality management district moving to share a building close to the embarcadero, temporary transbay terminal. that is a good thing for regional transit in the city. it is also good that the transportation authority will be 15 floors above the mta as well. that would kind of combined two of our local agencies. >> what would be in the building is the cultural center. the reference that cynthia made, other agencies in the building, yes. commissioner mar: seeing none, public comment is closed. can we move this forward without
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recommendation? commissioner elsbernd: i am going to reserve on this one. between now and the full board, i want to give them the packet and get their full pots on it. they have done just such a great job with all the purchases are run civic center. i would hate to say yes on this without speaking to them first. maybe we can send the four were without recommendation. commissioner mar: that is fine. without recommendation, without objection. thank you. please call the next item. >> state and federal legislative update. this is an information item. >> this is an item, since i was here last, we were recommending this.
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this was a bill that was amended and acted upon before we were able to come back here twice. i wanted to update you on a couple of the bills that were pending in the governor's office from the last time i was here. first and foremost, the bill from senator leno, the matrix starts on page 77 of your packet. his bill is on page 18 of that matrix. that is the bill that would have provided a vehicle license fee for the city and county of san francisco. the governor did veto that bill. the veto message did not say that he did not agree with the funding source or the purpose. he was more concerned that it was a piecemeal approach, allowing one county to move ahead the irony was that that was the only way that this legislator could get the bill out of their organization.
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one assemblymember also carried ab41 for the city which extended the current video imaging for transit lines for enforcement. that was approved favorably. that is on the books now. several other bills that affect transportation, transit in san francisco included ab426, page 5 of the matrix, that dealt with the mta. there was a change in the bill that allows transit fare evasion to be not only do the gated to a local process but also makes a more flexible and allow the transit agency to pursue it on a criminal basis, if they want to hear that was approved by the governor.
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ab4127 diaz with -- deals with prop ib. that allows for the redistribution of funds of agency that are unable to spend them. there might be some recapturing. the governor did sign this bill, so there might be the ability for the mta to recapture funds from other small operators in the region for security purposes -- purposes. one bill that was surprisingly vetoed, ab650, on page 8 of the matrix. that was an effort led by nrdc to build a freestanding task force of california. that was vetoed by the governor, on the same day that he did


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